General Mills Inc
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: −9.39%.
Did GIS Beat Earnings? Q3 2025 Results
General Mills delivered a mixed fiscal third quarter for 2025, managing a narrow earnings beat while falling short on sales in what CEO Jeff Harmening conceded came in below expectations. Adjusted diluted EPS of $1.00 cleared the $0.96 consensus by 4.08%, yet revenue of $4.84 billion trailed analyst estimates of $4.95 billion by 2.25%, sliding 5% year-over-year as retailer inventory reductions and weak U.S. snacking demand weighed heavily on the top line. The North America Retail segment bore the brunt of the pressure, with net sales falling 7% to $3.01 billion, while unfavorable foreign currency movements compounded the damage across the International segment. With consumers increasingly gravitating toward cheaper alternatives amid lingering inflation, the company also slashed its full-year outlook, now guiding organic net sales down 2% to 1.5% and adjusted diluted EPS down 8% to 7% in constant currency, a meaningful step down from prior guidance. Management pointed to a planned $100 million in incremental cost savings as a key lever to fund renewed investment in brands and innovation heading into fiscal 2026.
- Greater-than-expected retailer inventory reductions drove approximately 4 points of headwinds to organic net sales
- Slowdown in U.S. snacking categories impacted North America Retail
- Holistic Margin Management (HMM) cost savings partially offset input cost inflation
- Higher adjusted effective tax rate of 21.0% vs 18.4% year-ago due to non-recurring discrete tax benefits in fiscal 2024
- Higher net interest expense from increased long-term debt levels
- Lower net shares outstanding partially offset EPS declines
- Canada yogurt divestiture contributed $96 million pre-tax gain
“Our third-quarter organic net sales finished below our expectations, driven largely by greater-than-expected retailer inventory headwinds and a slowdown in snacking categories. At the same time, we drove continued positive market share trends in Pet, Foodservice, and International as well as improvement in Pillsbury refrigerated dough and Totino's hot snacks, two businesses where we made incremental investments last quarter and saw positive returns.”
General Mills CEO, on the earnings call
Forward Guidance & Outlook
General Mills lowered its full-year fiscal 2025 guidance. Organic net sales are now expected to be down 2% to down 1.5% (previously the lower end of flat to up 1%). Adjusted operating profit and adjusted diluted EPS are now expected to be down 8% to down 7% in constant currency (previously down 4% to down 2%). Free cash flow conversion is still expected to be at least 95% of adjusted after-tax earnings. The guidance does not include any impact from new tariff actions in 2025 due to continued uncertainty. For fiscal 2026, the company expects its HMM productivity program to deliver at least 5% COGS savings (~$600 million in gross productivity) plus additional cost-savings initiatives targeting at least $100 million, with savings to be reinvested in innovation, brand support, and consumer value to accelerate organic sales growth.
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Figures from SEC filings and company reports. Not investment advice.